St. Barbara Ltd. · ASX:SBM
St. Barbara — Corporate Update (October 2015)
67 slides from St. Barbara's corporate update, Oct 13, 2015
Slide 1: Presentation to analysts and investors at Leonora Operations
ASX Release / 13 October 2015 For personal use only Presentation to analysts and investors at Leonora Operations Attached is a presentation to analysts and investors attending site visits this week at Leonora Operations, Western Australia. Investor Relations Mr Rowan Cole Company Secretary +61 3 866
Slide 2: Gwalia investor and analyst site visit
BOB VASSIE, MANAGING DIRECTOR & CEO For personal use only Gwalia investor and analyst site visit 13 and 14 October 2015
Slide 3: Disclaimer
Disclaimer For personal use only This presentation has been prepared by St Barbara Limited (“Company”). The material contained in this presentation is for information purposes only. This presentation is not an offer or invitation for subscription or purchase of, or a recommendation in relation to, s
Slide 4: Contents
Contents ˃ Overview of Operations For personal use only ˃ FY16 Guidance ˃ Safety ˃ Gwalia Mine, Leonora, WA ˃ Production ˃ Business Improvement ˃ Growth ˃ Exploration ˃ Innovation and Diversity ˃ Appendices 3/ Leonora Operations Site Visit / October 2015
Slide 5: St Barbara's history
St Barbara’s history For personal use only 2005 2006 Leonora and Southern Cross Name changed to acquired from Sons of Gwalia St Barbara Ltd administrators & Meekatharra sold 2008 Gwalia commissioned 2004 Change in Board and 2011 Management King of the Hills commissioned Gold production, Meekatharra,
Slide 6: Overview of operations
Overview of operations ASX 300 listed Company (SBM), founded 1969 Consolidated ˃ Shares on issue For personal use only 495 M ˃ FY15A 377 koz ˃ Market Cap2 A$616 M @ AISC A$1,007/oz ˃ Ore Reserves 30 June 2015 4.0 Moz 1 ˃ FY16F3 344 koz ˃ Mineral Resources 30 June 2015 9.2 Moz 1 @ AISC A$1,038/oz ˃ A
Slide 7: FY15 Scorecard
FY15 Scorecard Objective Result For personal use only Guidance Gwalia – production and AISC1 Exceeded Simberi – production and AISC1 Achieved – 100 koz p.a. run rate Achieved – cash flow positive by June Quarter2 Exceeded Corporate Cost reduction Achieved Board renewal Achieved Gold Ridge - divestme
Slide 8: FY16 Guidance
FY16 Guidance Gwalia For personal use only > FY16 guidance – > Production: 220,000 to 250,000 ounces > AISC1 : A$875/oz – A$950/oz > Capex: A$30-$35m > Ore pass system currently 30% in place, will grow to 100% over the next 18 months Simberi > FY16 guidance > Production: 90,000 to 110,000 ounces > A
Slide 9: Share Price Reflects Turnaround
Share Price Reflects Turnaround ASX:SBM For personal use only $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.00 30 Jun 14 30 Sep 14 31 Dec 14 31 Mar 15 30 Jun 15 30 Sep 15 8/ Leonora Operations Site Visit / October 2015 Source: IRESS, close price, 30 Jun 2014 to 12 Oct 2015
Slide 10: Q4 June 2015 Snapshot: St Barbara vs ASX and TSX peers
Q4 June 2015 Snapshot: St Barbara vs ASX and TSX peers – AISC, Production and Enterprise Value 1,600 For personal use only Bubble Size = Production B2Gold 1,400 Evolution 1,200 (Q4 June 2015, excl. Cowal & La Mancha) Northern Star Enterprise Value US M$ 1,000 Iamgold 800 St Barbara Oceana Gold 600 P
Slide 11: Start safe, stay safe
Start safe, stay safe For personal use only Total Recordable Injury Frequency Rate Safety performance 12.5 ˃ TRIFR1 of 4.1 at 30 Sep 2015 ˃ Continued good results for mixed 9.0 jurisdiction underground / open pit combination2 ˃ TRIFR has plateaued due 6.0 to a number of low 5.0 4.1 4.1 severity inci
Slide 12: Leonora, Western Australia
Leonora, Western Australia For personal use only Gwalia Processing plant Gwalia Gwalia –– Underground Underground mining mining Truck Truck Gwalia – New Absorption Chiller Plant Underground drilling 11 / Leonora Operations Site Visit / October 2015
Slide 13: Gwalia - one of Australia's most historic mines
Gwalia- one of Australia’s most historic mines For personal use only 1896 - Welsh syndicate discovers the Gwalia Reef. 1897 - Herbert Hoover buys mine for Bewick Moreing 1929 - Hoover becomes 31st President of USA 1963 - Mine closes 4 days before Christmas having produced more than 2.5 Moz over 67 y
Slide 14: Gwalia: production increasing year on year
Gwalia: production increasing year on year ˃ FY15 AISC1 A$841/oz Mined Grade For personal use only (g/t Au) June 2015 8.8 8.9 ˃ Reserves at 30 June 20152: 8.2 8.4 Reserve grade 9.4 g/t Au 5.3 Mt @ 9.4 g/t Au for 1.6 Moz 6.9 6.3 5.7 250 ˃ Mine life based on Ore 248 Range Reserves2 ≈7 years 220 214 ˃
Slide 15: Gwalia: St Barbara's cornerstone mine
Gwalia: St Barbara’s cornerstone mine AISC (A$/oz) For personal use only 1,086 883 860 September 2015 Quarter: FY15 AISC A$841/oz 645 ˃ Record production of 248 koz for FY15 has continued into Q1 with 72,388 oz Mined Grade produced 9.7 9.7 (g/t Au) 9.0 8.6 ˃ Mined ore grade of 9.7 g/t Au higher June
Slide 16: Gwalia: FY16 production guidance
Gwalia: FY16 production guidance ˃ Production guidance for FY16 is 220,000 to 250,000 ounces. For personal use only ˃ FY15 result proved operational improvements can keep pace with and exceed impacts of increasing depth. ˃ Waste storage underground1 has proven to be valuable and needs to be maintain
Slide 17: Developments at Gwalia in FY15
Developments at Gwalia in FY15 Absorption chiller plant: For personal use only ˃ First utilisation of this technology in mining globally ˃ Cost A$5.5 million, projected savings in power usage- $2.7 million p.a. ˃ Environmental award finalist1 Deep HV Cable drop ˃ 1400m vertical HV cable drop – longe
Slide 18: Gwalia Operations
Gwalia Operations St Barbara Byrnecut – contract mining For personal use only ˃ Responsible for ˃ Byrnecut is part of Gwalia’s success ˃ Planning ˃ Started at Gwalia in Sep 2012 ˃ Processing ˃ Alliance agreement from Sep 2013 ˃ Procurement ˃ Approx. 200 employees ˃ Commercial ˃ Fleet: inc. ˃ Approx.
Slide 19: Gwalia Mining Strategy
Gwalia Mining Strategy Dual Lift Stoping in SWB Mining method For personal use only ˃ mining sequence manages the hanging wall ˃ Long hole stoping with fill FY11 ˃ North & South access on 2 two dual lift levels gives 4 mining areas 1 ˃ Greater percentage of 5 free bogging increases productivity of e
Slide 20: Gwalia - targeting higher production
Gwalia – targeting higher production Stope Cycle Time – 6 months per stope For personal use only ˃ ‘Bogging’ (extracting ore from the stope) represents just under 50% of stope cycle time, ˃ Filling and curing around 30% of stope cycle time ˃ Adjacent stopes (beside, above, below) cannot be developed
Slide 21: Gwalia - targeting higher production
Gwalia – targeting higher production Waste rock disposal below ground Northern abutment stopes For personal use only – three strategies Concurrent Stope filling Redundant level development 20 / Leonora Operations Site Visit / October 2015
Slide 22: Leonora - targeting higher production: Ore Pass system
Leonora – targeting higher production Ore Pass system For personal use only 21 / Leonora Operations Site Visit / October 2015
Slide 23: Gwalia geotech - management, monitoring, modelling
Gwalia geotech – management, monitoring, modelling For personal use only ˃ Gwalia stress/seismicity (to current depth) significantly less than other regional mines ˃ Geotechnical Performance modelled to 2,300 mbs by Mining One and verified by independent geotechnical expert ˃ FY16 LOM plan incorpora
Slide 24: Organic growth: Gwalia Deep Drilling Program
Organic growth: Gwalia Deep Drilling Program “This is an important input into the Long Section Looking West planned shaft study.”1 For personal use only > Drilling has been completed on a new daughter hole from parent GWDD13. Results from GWDD13H will be available in Sep Q1 Quarterly 1,800mbs > Resu
Slide 25: Exploration: Gwalia - Schematic Lode Plan View
Exploration: Gwalia – Schematic Lode Plan View Oct 2015 For personal use only 24 / Leonora Operations Site Visit / October 2015
Slide 26: Exploration: Gwalia - West Lode (Cross Section View)
Exploration: Gwalia – West Lode (Cross Section View) For personal use only 25 / Leonora Operations Site Visit / October 2015
Slide 27: Exploration: Gwalia West Lode - Long Section
Exploration: Gwalia West Lode – Long Section For personal use only > Ongoing exploration of an alternative mining area, ‘West Lode’ has revealed high grade intercepts and led to an improved Resource > It is anticipated that the modelling of West Lode, incorporating the results of recent drilling, wi
Slide 28: Gwalia South West Branch - Ounce / Depth Profile
Gwalia South West Branch – Ounce / Depth Profile For personal use only Current Mining Limited drilling data 27 / Leonora Operations Site Visit / October 2015
Slide 29: Gwalia West Lode - Ounce / Depth Profile
Gwalia West Lode – Ounce / Depth Profile For personal use only Chart does not reflect recent drilling as it is not yet included in resource Limited drilling data 28 / Leonora Operations Site Visit / October 2015
Slide 30: Leonora Growth Projects - Gwalia ore delivery infrastructure
Leonora Growth Projects – Gwalia ore delivery infrastructure Indicative timeline For personal use only Dependent on drilling and FY16 FY17 FY18 FY19 FY20 findings of studies >Resource Definition Drilling H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 - SWB Phase 3 - SWB Phase 4 - ML north of SWB - West Lode >Probabl
Slide 31: Leonora Growth Projects - Tower Hill
Leonora Growth Projects – Tower Hill Leonora ˃ 30 / For personal use only Tower Hill Gwalia 1km 30 / Leonora Operations Site Visit / October 2015
Slide 32: Leonora Growth Projects - Tower Hill
Leonora Growth Projects – Tower Hill > FY08 project drilled for open pit potential For personal use only > Evaluation failed to identify open pit business case > Remodelled to identify high grade core for underground evaluation > Narrow orebody, 400 dip, cut and fill, ultramafic hanging wall > Longh
Slide 33: Exploration
Exploration For personal use only Exploration FY15 exploration focused on near mine resources at Gwalia and Simberi Drilling at Monun Creek, Simberi PNG 2014 Deep drill at Gwalia, Western Australia, 2015 32 / Leonora Operations Site Visit / October 2015
Slide 34: Exploration - focus on near mine targets
Exploration – focus on near mine targets For personal use only Exploration > FY16F spend of A$10 million > 55% Western Australia > 45% Papua New Guinea > The FY16 exploration program will largely focus on potential near-mine ore sources at Gwalia and Simberi. > The aim for FY16 is to extend the life
Slide 35: Exploration: Centenary, Leonora WA
Exploration: Centenary, Leonora WA For personal use only > In Q3 FY15 St Barbara conducted electromagnetic (EM) survey work on Centenary Project approximately 60 km north of Leonora, utilising higher resolution EM equipment than has previously been available1 > Six significant anomalies were identif
Slide 36: Exploration: Pinjin, Leonora WA
Exploration: Pinjin, Leonora WA For personal use only > Exploration re-commenced on the Pinjin project within the Yilgarn Province, WA. The Pinjin Project is located 150 km northeast of Kalgoorlie > The focus during the June quarter was the collection and incorporation of all available historical dr
Slide 37: Gender Diversity - Recent Awards
Gender Diversity - Recent Awards For personal use only ˃ The overall pay equity gap at St Barbara reduced from 43% in 2007 to 11.4% in 2014 (compared to 23.8% for the mining industry and 18.2% nationally1) ˃ Awarded 2014 ‘Outstanding Company Initiative’ at Chamber of Minerals and Energy of WA Women
Slide 38: Waterwise Business Awards
Waterwise Business Awards (Water Corporation, WA) ˃ Over the past two years, Leonora Operation has saved approximately 28 For personal use only million litres of potable water p.a. with cash savings of nearly $250,000p.a. ˃ In recognition of the initiates to efficiently use and minimise the use of v
Slide 39: Golden Gecko Award
Golden Gecko Award ˃ St Barbara a finalist in 2015 Golden Gecko awards for Gwalia Chiller project (see slide 16) For personal use only ˃ Golden Gecko Award is a Western Australian State Government, Department of Minerals and Petroleum, award for environmental achievement ˃ Full details at http://www
Slide 40: Concept - before and after mine cooling system upgrade
Concept – before and after mine cooling system upgrade Mine cooling system upgrade overview 1 Chilled water feed to BAC ˃ 39 / For personal use only The existing mine air cooling system utilised refrigeration 2 Bulk Air Cooler (BAC)– Chilled water used system to produce chilled water. This water wou
Slide 41: Conclusion: The new St Barbara in FY16
Conclusion: The new St Barbara in FY16 ˃ Excess cash from operations to be applied to further reduce For personal use only debt in advance of schedule ˃ A$91 million cash flow from operations in 2H FY15 ˃ US$67M Notes repaid between June and September 2015 ˃ Progress opportunities within portfolio ˃
Slide 42: Appendices
For personal use only Appendices Sunrise at start of shift, Gwalia Mining office. 41 / Leonora Operations Site Visit / October 2015 Photo: S Mohammed, 2015
Slide 43: Consolidated Gold Production
Consolidated Gold Production AISC (Consolidated) (A$/oz) For personal use only 1,344 FY15 Highlights 1,042 979 ˃ Record production for: FY15 AISC A$1,007/oz 798 ˃ Company 377 koz 111 111 ˃ Gwalia 248 koz 99 98 22 ˃ Simberi 80 koz 30 17 69 12 27 9 ˃ Simberi production exceeded 12 13 15 100 koz p.a. r
Slide 44: Consolidated Production, Costs, Guidance Summary
Consolidated Production, Costs, Guidance Summary Production Summary Q1 Sep Q2 Dec Q3 Mar Q4 Jun Year Guidance Guidance For personal use only Consolidated FY15 FY15 FY15 FY15 FY15 FY15 [3] FY16 Production Gwalia oz 45,391 68,589 76,954 57,208 248,142 235 – 240 koz 220 - 250 koz King of the Hills oz 1
Slide 45: Gwalia Process Chart - Crushing
Gwalia Process Chart - Crushing For personal use only 44 / Leonora Operations Site Visit / October 2015 Strictly Commercial in Confidence
Slide 46: Gwalia Process Chart - Milling
Gwalia Process Chart - Milling For personal use only 45 / Leonora Operations Site Visit / October 2015 Strictly Commercial in Confidence
Slide 47: Gwalia Process Chart - Elution
Gwalia Process Chart - Elution For personal use only 46 / Leonora Operations Site Visit / October 2015 Strictly Commercial in Confidence
Slide 48: Leonora Growth Projects - Tower Hill
For personal use only Leonora Growth Projects – Tower Hill Mafic High grade zone Mineralised envelope Granite 47 / Leonora Operations Site Visit / October 2015
Slide 49: Infrastructure is scalable to support deeper mining
Infrastructure is scalable to support deeper mining Commissioned in 2012 and ready for 10+ years life of mine For personal use only ˃ Ventilation Fans – 2 x 1350kW – Final Duty 450 m3/sec @ 4kPa ˃ Refrigeration – Upgraded in FY15 to 7.5 MWr ˃ Paste Fill Plant – 100 m3/hr (current rate 130 m3/hr) ˃ P
Slide 50: Stress Results - Comparatively benign to region
Stress Results – Comparatively benign to region Stress Test Results & Yilgarn Block Trends For personal use only Principal Stress (MPa) 0 50 100 150 200 250 300 0 200 400 600 800 Depth (mbs) 1000 1200 1400 1600 1800 2000 HI AE Min Yilgarn Max Yilgarn Extrapolated Max Yilgarn Trend AMC Calc Stress= 2
Slide 51: King of the Hills + Kailis divestment
King of the Hills + Kailis divestment ˃ Sale of King of the Hills mine and Kailis resource announced For personal use only 20 August 20152 ˃ Consideration for the sale is $3 million, with $0.3 million payable on completion ˃ On completion of the sale the rehabilitation provision of $14 million1 rela
Slide 52: Ore Reserves & Mineral Resources at June 2015
Ore Reserves & Mineral Resources at 30 June 2015 ˃ Ore Reserves & Resources reduced via production depletion and For personal use only sale of Gold Ridge Ore Reserves and % of Ore Reserves 1 Mineral Resources 1 13.16 Leonora, 9.22 WA 47% Simberi, 5.16 PNG 4.02 53% FY 14 FY 15 Mineral Resources Ore R
Slide 53: Ore Reserves Summary as at June 2015
Ore Reserves Summary as at 30 June 2015 Project Proved Probable Total For personal use only Tonnes (k) Au koz Tonnes (k) Au g/t koz Tonnes (k) Au koz g/t g/t Gwalia (WA) 2,100 9.1 614 3,190 9.6 980 5,290 9.4 1,594 Tower Hill (WA) - - - 2,572 3.7 306 2,572 3.7 306 Simberi Oxide (PNG) 3,800 1.5 178 15
Slide 54: Major variances to Ore Reserves FY14 to FY15
Major variances to Ore Reserves FY14 to FY15 1 koz For personal use only 6,000 5,165 5,000 -673 4,003 4,000 -426 -60 -3 3,000 2,000 1,000 0 June Divestment of Gold Depletion through Design changes* King of the Hills June 2014 Ridge Operation mining and processing Closure 2015 of stockpiles * Changes
Slide 55: Mineral Resources Summary as at June 2015
Mineral Resources Summary as at 30 June 2015 Project Measured Indicated Inferred Total For personal use only Tonnes Au koz Tonnes Au koz Tonnes Au koz Tonnes (k) Au koz (k) g/t (k) g/t (k) g/t g/t Gwalia (WA) 4,781 7.2 1,112 6,112 9.3 1,833 2,036 5.5 359 12,929 7.9 3,304 King of the Hills - - - 799
Slide 56: Major variances to Mineral Resources FY14 to FY15
Major variances to Mineral Resources FY14 to FY151 koz For personal use only 14,000 13,161 12,000 10,000 -3,175 9,223 -426 -80 -4 -254 8,000 6,000 4,000 2,000 0 June Gold Ridge Depletion through Sterilisation of non- Revised geological Revised geological June 2014 Divestment mining and recoverable m
Slide 57: Cash, debt, hedging at June 2015
Cash, debt, hedging at 30 June 2015 June 2014 June 2015 Sep 2015 A$M A$M A$M For personal use only Cash balance 1 79 77 115 Interest bearing debt FX 0.9430 0.7713 0.7010 ˃ US Senior Secured Notes US$ 250 196 183 ˃ Red Kite US$ 75 75 66 US$ 325 271 249 ˃ A$ equivalent A$ 330 A$ 342 A$ 355 ˃ Lease lia
Slide 58: Cash movement FY15
Cash movement FY15 300 For personal use only 275 186 - -14 -10 250 -22 225 -10 -28 200 -71 175 A$ Million 150 125 -33 100 79 77 75 50 25 - Cash Jun Leonora Ops Simberi Ops Gold Ridge Exploration Corporate Other Net interest Other Working Cash Jun 2014 Ops (incl Capex) financing capital [1] 2015 57 /
Slide 59: A$ margin increases as exchange rate decreases
A$ margin increases as exchange rate decreases FY15 A$ and US$ St Barbara AISC Margin For personal use only $/oz 1,700 (using St Barbara AISC of A$1,007) 1,600 AUD$ Gold price/oz 1,500 1,400 1,300 A$ margin Gold Shaded Area = A$ spot – AISC Margin expanding 1,200 1,100 1,000 St Barbara A$ AISC/oz ff
Slide 60: US$ debt vs. US$ based revenue, acts as a natural hedge
US$ debt vs. US$ based revenue, acts as a natural hedge1 Rev vs Debt Rev vs Debt Rev vs Debt US$ A$ @ 0.70 A$ @ 0.65 For personal use only A$ 582M A$ 540M A$ 397M US$ 378M A$ 369M US$ 258M US$ A$0.70 A$0.65 Revenue Debt ˃ Revenue based on FY16F guidance mid point 344 koz ˃ Assumed gold price US$1,10
Slide 61: Board of Directors
Board of Directors For personal use only Tim Netscher Bob Vassie Chairman– Non Executive Managing Director and CEO Appointed February 2014 Appointed July 2014 Mr Netscher was the Managing Director of Mr Vassie is a mining engineer with 30 Gindalbie Metals Limited from 2011 to 2013, years internation
Slide 62: Executive Leadership Team
Executive Leadership Team Bob Vassie For personal use only Managing Director and CEO Appointed 2014 Mr Vassie is a mining engineer with 30 years international mining industry experience, including as Managing Director and CEO of Inova Resources Limited (formerly Ivanhoe Australia Limited) and 18 yea
Slide 63: Strong institutional share register
Strong institutional share register Top 100 Shareholding Structure For personal use only Institutions 70% Australia, 38% Private, 13% UK, 20% USA, 15% Unallocated/ Europe, 5% not analysed, Asia, 2% 17% Other / not analysed, 20% 62 / Leonora Operations Site Visit / October 2015 Analysis and geographi
Slide 64: Significant shareholders & wide broker coverage
Significant shareholders & wide broker coverage For personal use only Significant Shareholders 1 Broker Research Coverage Hunter Hall 15% Canaccord Reg Spencer M&G Investment Mgt 12% Deutsche Bank Matthew Hocking Franklin Resources Inc 7% Macquarie Ben Crowley Petra Capital David Cotterell Instituti
Slide 65: Competent Persons Statement
Competent Persons Statement For personal use only Exploration Results The information in this presentation that relates to Exploration Results for Simberi and Pinjin is based on information compiled by Dr Roger Mustard, who is a Member of The Australasian Institute of Mining and Metallurgy. Dr Musta
Slide 66: Non-IFRS Measures
Non-IFRS Measures For personal use only We supplement our financial information reporting determined under International Financial Reporting Standards (IFRS) with certain non-IFRS financial measures, including cash operating costs. We believe that these measures provide meaningful information to ass
Slide 67: Investor Relations Enquiries
Investor Relations Enquiries For personal use only Rowan Cole Company Secretary E: info@stbarbara.com.au T: +61 3 8660 1900 www.stbarbara.com.au ASX: SBM 66 / Leonora Operations Site Visit / October 2015